COURSE OVERVIEW

This course is made for bank practitioners from front office, back office and central units who are confronted with credit risk. By attending this practical and informative course, you will be able to understand credit risk in all its facets, quantitative and qualitative ones. When assessing the credit risk of an SME you are overwhelmed with information. The course helps you to structure the information and focus on the crucial risk drivers, so you can develop an integrated strategy for the identification, analysis and mitigation of credit risks, both on client as well as portfolio level. In addition, the course develops an understanding for the organizational aspects of a bank’s credit business with regard to structures and processes. This enables financial institutions not only to manage credit risk, but to do it in an efficient cost saving manner. The course participants will discuss the latest international developments in credit risk management and supervision. Through interesting case studies and exercises, delegates develop a new approach to complex analytical tasks. During group work the participants will have the chance to build a network with other practitioners which will help to exchange ideas and solutions on credit risk management in future.

KEY TAKEAWAYS

Get a better understanding of international supervisory requirements on credit risk management (incl. Basel II, Basel III and Basel IV)

Understand the key drivers for credit loss at portfolio level and Learn about efficient and practical risk management tools at portfolio level

WHO SHOULD ATTEND?

The training is ideally suited to anybody in a corporate banking environment, including relationship managers and support staff who deal directly with customers in their roles. Additionally, staff in credit sanctioning or credit administration roles will benefit from attending. Ideally, attendees will not be new-to-role, as the training is not aimed at foundation level. However, if they have experience of working with financial statements, then exceptions can be made.

CERTIFICATION

The International Academy of Business and Financial Management is one of the world’s fastest growing professional associations with more than 200,000 members, associates and affiliates in 145 countries. IABFM™ hosts and organizes certification training worldwide and offers exclusive board designations to candidates who meet the highest professional standards and assessment criteria.
The IABFM is credited by the American National Standards Institute (ANSI) the International Standards setting authority.

Day 2CREDIT RISK AT PORTFOLIO LEVEL
– Discussion of rating, scoring and the mathematics of credit risk management (PD, EAD, LGD, migration matrix) with its limitations
– Understanding Credit risk models and its main parameters (esp. Value at risk)
– Risk adjusted pricing in theory and practice
– Credit risk strategies – for what it is good and how to develop one
– Risk Taking Capacity – an instrument for overall bank risk management
– Reporting system – how a risk oriented reporting system should be designed
– Why indirect FX risk and forward rates are important for credit risk management
Day 3ORGANIZATION OF CREDIT BUSINESS
– How the proper organization of the bank’s credit business can save money
– Possible organizational structures in credit business
– How an optimal credit process should be designed to lower credit risk and speed up the process
– Managing instruments in credit business – practical tools for a streamlined credit process
– Risk relevant credit business – how a bank can handle and structure SME credit business
– Ways for the optimization of credit business
– Intensive and problem loan management, watch list, restructuring
Day 4CREDIT RISK AT CLIENT LEVEL I
– Specifics of SME Business
– Islamic Banking – how to bring it together with modern credit risk management
– Business plan analysis – the basis of credit risk assessment
– Cash flow, discounted cash flow and why it is important for credit risk
– Analysis of financials, especially ratio analysis
– Exercises
Day 5CREDIT RISK AT CLIENT LEVEL II
– Non-financial analysis of a SME client
– Tools for non-financial analysis
– Marketing analysis – a quantitative approach
– Exercises